Chem Rx Signs Agreement With PharMerica
Continues Focus on Customers and Deliveries
Sep. 27, 2010 (PR Newswire) --
LONG BEACH, N.Y., Sept. 27 /PRNewswire-FirstCall/ -- Chem Rx Corporation (Pink Sheets: CHRXQ) ("Chem Rx"), the third largest long-term care pharmacy in the United States, today announced that it has reached a "stalking horse" asset purchase agreement to sell substantially all of the assets of the company to PharMerica Corporation (NYSE: PMC), an industry-leading pharmaceutical services company serving residents in long-term facilities and settings. Partnering with Chem Rx will allow PharMerica to expand into New York and New Jersey, where it currently does not have a presence. Chem Rx will continue to maintain normal business operations throughout this process and thereafter.
Per the terms of the agreement, Chem Rx's founder Jerry Silva and management team, including Steve Silva, Gary Jacobs, Evan Selzer, Paula Agoglia, Jody Silva-Falk, Shelly Evans, Michael Segal and Leora Tilocca will continue to be responsible for the day-to-day operations of Chem Rx. The company will also continue to operate under the Chem Rx name. The sale, conducted pursuant to Section 363 of the U.S. Bankruptcy Code, will significantly eliminate the company's debt.
"We are excited about joining forces with PharMerica, which shares our commitment to providing clients with the drugs and supplies they need accurately and on time," said Jerry Silva, Chem Rx Chief Executive Officer. "This agreement will not only allow Chem Rx to continue serving our loyal customers in the same way we have for so many years, but also enable us to leverage the best technology available to ensure that we are at the forefront of long-term pharmacy care in the future. We believe that PharMerica is the best partner to take the company forward and we look forward to working with PharMerica throughout this process."
Like Chem Rx, PharMerica is dedicated to providing quality customer service and innovative pharmacy solutions to institutional customers and patients in long-term care settings. A leader in U.S. industrial pharmaceutical services, PharMerica operates 90 institutional pharmacies in 41 states that serve more than 300,000 licensed beds for patients of long-term care facilities. PharMerica has approximately 6,000 employees nationwide.
There will be no disruption of service or deliveries to Chem Rx's clients as a result of today's filing and subsequent auction proceedings. Clients will continue to receive drugs, medical equipment and surgical supplies according to the same ordering processes and delivery schedules.
As standard procedure in the process, Chem Rx will file the stalking horse asset purchase agreement with the United States Bankruptcy Court for the District of Delaware along with a motion seeking the establishment of bidding procedures for an auction that allows other qualified bidders to submit higher or otherwise better offers. The sale to PharMerica will include substantially all of Chem Rx's current assets, operations and employees.
About Chem Rx
Founded more than 40 years ago, Chem Rx is a major institutional pharmacy serving the New York City metropolitan area, as well as parts of New Jersey, upstate New York, Pennsylvania and Florida. Chem Rx's client base includes skilled nursing facilities and a wide range of other long-term care facilities. Chem Rx annually provides over six million prescriptions to over 60,000 residents of more than 400 institutional facilities. Chem Rx's website address is www.chemrx.net.
PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 files 8K to buy Chem Rx Corp. (CHRXQ: OTC for $70.6 million, and assume all debt!
Chem Rx(CHRXQ) has 13,791,866 shares on record as of August 13, 2008. With a cash offer of $70.6 million for all operations, equipment, employees, and all the debt , Thats right with all debt being acquired PharMerica, that’s a True Cash offer.
Sales price per share details have not yet been released, but when you see words like “stalking horse”, and see a series of SEC forms being filed by both companies it sets off radars. We started digging and everything mentioned here is taken from both of the company’s most recent SEC filings. See links below.
We find it very interested that the only thing not mentioned is the deal is the sale price in relation to shares, with a $70.6 million dollar offer, and with zero debt obligations at 13.7Million shares, we did the Math and our eyes got huge too! $$$$
To clarify, “a stalking horse” asset purchase agreement refers to an attempt by CHRXQ to test the market in advance of a court-approved auction. The intent is to maximize the value of its assets as part of, or before a bankruptcy court-approved auction process.
We believe ChemRx (CHRXQ) management is attempting to make a swift move here to maximize the value of its assets to obtain a higher buyout offer per share!!
While entering a "stalking horse" offer, CHRXQ can offer bidding protections to PharMerica Corp. before the auction. "These incentives enhance the value of the offering for PharMerica which might lead to a better price offer before the auction begins which could benefit CHRXQ.
Here’s the basics:
- CHRXQ, headquartered in Long Beach, NY, is the third largest Long Term Care pharmacy in the U.S., and is family operated. CHRXQ currently services all of New York State, New Jersey, Pennsylvania, Florida and Illinois.
- CHRXQ is a huge company that’s been around for more than 40 years and services multiple industries - prescription and non-prescription drugs, intravenous medications, durable medical equipment items and surgical supplies - for more than 67,000 residents.
- CHRXQ filed for Chapter 11 bankruptcy protection in the Delaware District of United States Bankruptcy Court on May 11.
- PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Files a SEC form 8K on September 28, 2010 to acquire the Assets from the Seller for $70,600,000 in cash plus the assumption of specified liabilities related to the Assets.
- PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Files a SEC form 8K on September 28, 2010 .The Company has deposited $3,530,000 into escrow which will be credited to the purchase price on the completion of the acquisition of the Assets.
- To sumerize the 8K PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Agree’s to acquire the Assets for $70,600,000 in cash, and this is huge listen and Assumption of all debt!
Last week Monday, it was announced that CHRXQ had reached “a stalking horse” asset purchase agreement with pharmaceutical services company PharMerica Corporation (NYSE: PMC). The total value of the buyout was $70.6 million.
In the deal PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Files a SEC form 8K on September 28, 2010 to acquire the Assets from the Seller for $70,600,000 in cash plus the assumption of specified liabilities related to the Assets.
To sumerize the 8K PharMerica Corporation (NYSE: PMC). PMC:NYSE 9.40 Agree’s to acquire the Assets for $70,600,000 in cash, and this is huge listen and Assumption of all debt! See current share structure link below!!
To clarify, “a stalking horse” asset purchase agreement refers to an attempt by CHRXQ to test the market in advance of a court-approved auction. The intent is to maximize the value of its assets as part of, or before a bankruptcy court-approved auction process.
While entering a stalking horse offer, CHRXQ can offer bidding protections to PharMerica Corp. before the auction. These incentives enhance the value of the offering for PharMerica which might lead to a better price offer before the auction begins which could benefit CHRXQ.
WHICH IT DID!! When news hit on last Monday, Sept. 27, CHRXQ exploded for high of .17. (a gain of 183% when we alerted at .06). Thursday, Sept. 30, CHRXQ hit a day low of .015, but rocketed up to .07 on Friday, Oct. 1, for a triple digit gain (ALL OF THIS ON VERY LOW VOLUMES)-
As of end of trading Monday, CHRXQ crossed the finish line at .04. Now, we expect a good push. The “stalking horse” could in the form of good news that would serve as good sign for CHRXQ.
Take for example in late-July 2009, Telefon AB L.M. Ericsson had won a stalking horse bid to acquire Nortel Networks Corp's CDMA division, for $1.13 billion. And as news trickled in about the acquisition, Nortel responded with a profitable August (up more than 100%).
With low volumes and pending news ahead, it’s best to catch this wave before it starts. WhenCHRXQ’s “stalking horse” becomes a thoroughbred, you should cross the finish line with some winnable profits!
Please allow yourself to do your due diligence at the company’s website, http://www.chemrx.net/.
http://www.pharmerica.com/
Current filings
http://www.otcmarkets.com/stock/CHRXQ/financials
http://www.otcmarkets.com/stock/PMC/financials
Company Info
http://www.otcmarkets.com/stock/PMC/company-info
http://www.otcmarkets.com/stock/CHRXQ/company-info
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